Teacher Compensation: The Supply Side

Previous analyses of teacher compensation contracts have assumed an unlimited supply of potential teachers. Jesse Rothstein has extended these analyses to consider the supply side of the teacher labour market. He has determined that implementing a performance-linked contract will require substantial increases in teacher compensation, sufficient to offset half or more of the improvements in teacher productivity that the contracts can generate.

During his visit to CESifo, Mr Rothstein will work on two projects. The first is a study of the use of so-called "plausible values" to report student achievement in large-scale assessment samples such as the NAEP, PISA and TIMSS. Scores reported in these studies do not derive solely from the student's own performance but rather borrow information from the performance of other students with similar observable characteristics (e.g., race and parental education). This has implications for the subsequent use of the test scores in secondary analyses that are not often recognised by data users. With Brian Jacob, Mr Rothstein is exploring the degree to which the scoring process biases the results of the kinds of analyses that are typically conducted with the data.

A second study, also with Brian Jacob, will examine the role of student stamina in measured achievement. It is reasonably well established that student performance falls off over the course of assessments as the student tires out. This fall-off is heterogeneous across students, implying that a student's ranking will depend on the length of the test — a student with high stamina will do better on a long assessment than on a short one, while a student who tires easily will do better on a short assessment. There also appears to be systematic variation in the degree of fall-off across groups of students.

Jesse Rothstein is Associate Professor in the Department of Economics and the Goldman School of Public Policy at the University of California, Berkeley, where he has been on the faculty since 2010. He is also a Research Associate of the National Bureau of Economic Research and a Fellow of the National Education Policy Center. Prior to coming to Berkeley, he served as Assistant Professor of Economics and Public Affairs at Princeton University, as Senior Economist for Education and Labour at the Council of Economic Advisers, and as Chief Economist at the US Department of Labor. He serves on the editorial boards of the American Economic Review and Industrial Relations.